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Oman scales back income tax proposal

Feb 3, 2025, 7:47am EST
gulfMiddle East
Muscat skyline, near the old city of Muscat.
Sam Gao/Flickr
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The News

Omani authorities are showing some nervousness about their taboo-breaking plan to introduce income tax, with the country’s parliament now suggesting a lower rate and a higher threshold before people start paying.

Under draft proposals sent to Sultan Haitham bin Tariq for approval, foreigners will have to earn more than $130,000 before they are taxed, up from a previous $100,000 threshold. The maximum rate has also been slashed from 15% to 5%. Omanis will only pay 5% on global income over $1 million.

Plans for an income tax were first announced in 2020, but the introduction date has been repeatedly postponed and few expect payslips to be docked before 2027.

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While corporate taxes are now common around the region, no Gulf government has yet levied income tax, although mandatory social security contributions are common.

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